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Pension, health care changes key to Senate postal reform plan

Changes to the way the Office of Personnel Management calculates how much the U.S.
Postal Service pays into employees' retirement plans could help the agency dig
itself out of debt by generating a $6 billion surplus.

That's one of the highlights of the new Senate postal reform bill.

The bipartisan Postal Reform Act of 2013 (S. 1486), introduced Thursday night by Chairman Tom Carper (D-
Del.) and Ranking Member Tom Coburn (R-Okla.) of the Senate Homeland Security and
Governmental Affairs Committee, aims to help USPS pay some of the $15.9
billion it owes the Treasury in outstanding debt.

USPS also has to address the congressionally-mandated payment of $5 billion-plus
that it must make to the Treasury before Fiscal Year 2013 ends on Sept. 30.

The Senate bill contains language to reform USPS in five areas:

Pension Reforms - OPM would draw on
new data to determine how much USPS pays into the Federal Employees Retirement
System (FERS) and the Civil Service Retirement System (CSRS).

Currently, OPM draws on data from the entire federal workforce, which is different
than that of the average postal retiree, a committee aide said in a briefing
Friday. The bill would require OPM to base its calculations on data specific to
the Postal Service workforce.

The new data would more accurately reflect the differences between non-postal and
postal federal employees. It would also generate a surplus from FERS and and a
smaller deficit in CSRS for the Postal Service, the committee aide said. USPS
would be able pay up to $6 billion in surplus funds generated from the change
toward its $15.9 billion in Treasury debt.

In its 2012 postal reform bill, the Senate called for a buyout plan
to encourage postal employees to opt for early retirement. The current bill
contains no language about the buyout because USPS determined it doesn't need
additional money for buyouts, the committee aide said.

Postal unions would now be able to bargain with USPS during contract negotiations
over the amount new employees could participate in FERS and the Thrift Savings
Program (TSP).

A new health plan would be created to address the needs of retirees enrolled in
Medicare parts A and B. Some of these employees now pay for full Medicare and
Federal Employees Health Benefit Plan (FEHBP) coverage. Those postal retirees not
enrolled in Medicare would be able to do so without being penalized.

Postal unions would also be able to bargain with USPS over a new health plan,
which could be either in or outside of FEHBP. If an agreement is not reached, it
can be taken to arbitration to be resolved.

Service Changes - Last year's Senate bill called for cuts to overnight
delivery. It also called for the closing or consolidation of a large number of
mail processing plants. Under the new bill, a two-year moratorium would be placed
on standard service
changes and plant closings.
Saturday service would continue and new requirements for centralized or curbside
delivery would be put in place for new addresses or business addresses. The Postal
Service would also pursue changing door delivery at residential addresses on a
voluntary basis to centralized or curbside delivery.

Revenue and Innovation - Several revenue-producing changes would be
introduced, including lifting the prohibition on shipping beer, wine and
distilled spirits.

Federal Workers Compensation Reform - The bill, which includes the
Workers Compensation Act of 2013, would bring the compensation levels of older
postal employees in line with their retirement benefits.

"The bill that Dr. Coburn and I introduced last night presents a comprehensive and
bipartisan solution to the Postal Service's financial challenges that would
prevent collapse, protect millions of mailing industry jobs, and enable this
critical institution to serve the American public for years to come," Carper said
in a statement. "This bill isn't perfect and will certainly change as Dr. Coburn
and I hear from colleagues and stakeholders, including postal employees and
customers. But the time to act is now. It is my hope that Congress and the Obama
Administration can come together to enhance this plan in order to save the Postal
Service before it's too late."

In the same statement, Coburn echoed Carper's view that the bill was less than
perfect. "This proposal is a rough draft of an agreement subject to change that I
hope will move us closer to a solution that will protect taxpayers and ensure the
Postal Service can remain economically viable, while providing vital services for
the American people," he said.